CONSERVATIVE
New Forest East

'SHIFTING THE GOALPOSTS? – DEFENCE EXPENDITURE AND THE 2% PLEDGE'

TRANSCRIPT OF JOHN HUMPHRYS INTERVIEW WITH JULIAN LEWIS MP, CHAIRMAN OF THE DEFENCE SELECT COMMITTEE

Today, BBC Radio 4 – 21 April 2016

JOHN HUMPHRYS: A committee of MPs has made serious allegations about the way the Government has handled defence spending. It says the Government has been able to meet the NATO spending target only by modifying the MoD accounts. I am joined by Dr Julian Lewis, Conservative MP who chairs the Defence Select Committee. Modifying – does that mean fiddling?

JULIAN LEWIS: No, it doesn’t mean fiddling, because no rules have been broken at any stage – we are quite clear about this. What it does mean is that we are now counting, as part of a total to calculate how much the percentage of Gross Domestic Product spent on defence 

JOHN HUMPHRYS: And it is meant to be two per cent – that is our commitment?

JULIAN LEWIS: Well, that has become a bit of a myth. I mean, it is a commitment to spend at least two per cent. And never in our history have we been in danger, prior to this last iteration, of dropping below two per cent. So what happened is that, and this is what we were trying to do with our report, we wanted to calculate what defence expenditure would have been as a percentage of GDP, if they had applied the same criteria that they had applied five years previously. And the best that we can do is an estimate drawn on the testimony of experts in the field that it would have actually come in slightly below the two per cent. But we also wanted to set the thing in its wider historical context, where two per cent, it would suggest, in the present security environment is nothing like what we need.

JOHN HUMPHRYS: And what you are saying, what you are suggesting, perhaps the reason why they achieved even that two per cent is that they are including things like war pensions and intelligence gathering in the sums?

JULIAN LEWIS: Yes, I mean, some of the money for intelligence gathering is clearly new money. There is a new fund of, I think, about a billion-and-a-half, which defence would be able to bid for on a project-by-project basis, and that is at least new money. But when they start including war pensions and the pensions of retired MoD civil servants, even though NATO guidelines allow them to do it, all we are saying is they should have flagged that up, saying:

"This is a category of expenditure that we chose not to include in the past, but we are now, frankly, trying to amass every little bit that we can in order to scrape over the two per cent threshold."

JOHN HUMPHRYS: Dr Julian Lewis, Chair of the Defence Select Committee, thank you very much indeed.